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Sometimes they also sponsor games and sports at national as well as international level. In some places businessmen provide free medical facility to poor patients. engage themselves in research for improving the quality of transport. which is not going to give them any profit straightaway. For example. Did we ever wonder why they do so? . which is carried out on a regular basis to earn profit. we must have seen businessmen maintaining and developing gardens and parks on streets and squares products. education and health care to their employees and their families. in cities.SOCIAL RESPONSIBILITIES OF BUSINESS We know that business is an economic activity. we must have seen businessmen spending money on different aspects. some Some provide businessmen housing. However.
OBJECTIVES:After studying this. Recognize the responsibility of business towards different interest groups. . Explain the concept of social values and business ethics.Let us learn more about why businessmen engage themselves in such activities. Identify the causes of environmental and pollution. we will be able to: Explain the concept of social responsibility of business. Appreciate the importance of social responsibility.
For example. They do several things for us and expect something from us. Why do we perform all these activities? It is because we live in a family as well as in a society and the members of our family as well as the society want us to do all of them. brushing our teeth. we perform a number of activities. which we must do.Describe the role of business in preventing and controlling environmental pollution. The expectations of the family or society become our obligations. WHAT IS SOCIAL RESPONSIBILITY? In our daily life. showing respect to elders obeying traffic rules on the road etc. listening to our parents. which we need to .
It uses the resources of the society and depends on the society for its functioning. Any responsibility we have. There are also obligations towards ourself. which keeps us fit and takes care of our health. are called our social responsibility. This is true in case of business also. which we need to fulfill. etc. Every business operates within a society. This creates an obligation on the part of business to look after the welfare of society. For example.fulfill. etc. keeping the road clean by not littering. These duties can be a part of the routine functions of carrying on business activity or they may be an additional function of carrying . particularly towards members of the society with whom we interact or towards the society in general. eating our meals on time. Now we fulfill all these obligations by performing certain activities which are called our responsibilities. getting the right amount of sleep. So all the activities of the business should be such that they will not harm. For example: taking care of our parents or children. rather they will protect and contribute to the interests of the society. Social responsibility of business refers to all such duties and obligations of business directed towards the welfare of society.
It also provides scholarships or fellowships to the family members of its employees for studying abroad. Let us take an example. A drugmanufacturing firm undertakes extensive research and thus. in both the cases. In case of the former. produces drugs which are qualitatively superior. We find. WHY SHOULD BUSINESS BE SOCIALLY RESPONSIBLE? Social responsibility is a voluntary effort on the part of business to take various steps to satisfy the expectation . the drug-manufacturing firm is carrying out its social responsibility. it is a part of its routine business function while in the latter case it is a welfare function.out welfare activity.
good public employees to work with such employers. As you have already learnt. Government Regulation .The activities of business towards the welfare of the society earn goodwill and reputation for the business.To avoid government regulations businessmen should discharge their duties voluntarily. Instead. if any pollutes the environment it will strict government force the business firm naturally come under regulation. investors. For example. Public Image . ii. why the business should come forward and be responsible towards these interest groups. The earnings of business also depend upon the public image of products of a social image also its activities. consumers. which may ultimately firm to close down its business. government and society or community. But the question arises. the interest groups may be owners. the . People prefer to buy company that engages itself in various attracts honest and competent welfare programmes. Again.of the different interest groups. Let us consider the following points:i. employees.
Survival and Growth -Every business is a part the society. Business utilizes the available resources like power. water. Employee satisfaction . etc. transportation. So for its survival and of growth. iv. . if business spends money on training of the employees. earn more profit. For example. The employers expectation of the satisfaction is also employees education because proper and employee should try to fulfill all the directly related to productivity and it is required for the long-term prosperity of the organisation. of should be the responsibility spend a part of its profit of the society. land. support from the society is very much essential.business firm should engage itself in a pollution free environment. roads.Besides getting good salary and working in a healthy atmosphere. So it every business to for the welfare of the society. it will have more efficient people to work and thus. training. maintaining iii. employees also expect other facilities like accommodation.
v. Consumer Awareness . They protest against the supply of inferior and harmful products by forming different groups. has made it obligatory for the business to interest of the consumers by providing products at the most competitive price.Now-a-days consumers have become very conscious about their rights. protect This the quality .
housing construction. 1986 Industrial development in the field of manufactured goods has led to the influx of various consumer goods into the Indian market to cater to the needs of the consumers and a variety of services such as banking.SOCIAL RESPONSIBILITY LAWS & HOW IT IS IMPLEMENTED IN INDIA. 1986 and it applies to the whole of India except the State of Jammu and Kashmir. insurance. financing. Objects of the Consumer Protection Act. transport. 1986 . CONSUMER PROTECTION ACT. entertainment have been made available to the consumers. In order to protect the consumers from exploitation and to save them from adulterated and substandard goods and deficient services the Consumer Protection Act came into force on 15th April.
The right to be informed about the quality.The preamble to the Act states that the Act is legislated to provide for better protection of the interests of consumers and for that purpose to make provision for the establishment of consumer councils and other authorities for the settlement of consumer's disputes and for matters connected therewith. or services so as to protect the consumer against unfair trade practices 3. standard and price of goods. access to variety of goods and services at competitive prices 4. The right to be heard and be assured that consumers' interests will receive due consideration at appropriate forums . quantity. potency. The right to be assured. The right to be protected against marketing of goods and services which are hazardous to life and property 2. purity. The basic rights of consumers as per the Consumer Protection Act (CPA) are 1. wherever possible.
The right to seek redressal against unfair trade practices or restrictive trade practices or unscrupulous exploitation of consumers 6. The right to consumer education The CPA extends to the whole of India except the State of Jammu and Kashmir and applies to all goods and services unless otherwise notified by the Central Government. .5.
investors. Business Investors Employees Government Competitors Society Customers Suppliers .RESPONSIBILITY TOWARDS DIFFERENT INTEREST GROUPS After getting some idea about the concept and importance of social responsibility of business let us look into the various responsibilities that a business has towards different groups with whom it interacts. government and society. the interest of these groups is affected directly or indirectly. competitors. employees. customers. The business generally interacts with owners. suppliers. They are called as interest groups because by each and every activity of business.
SOCIAL RESPONSIBILITY AT ORGANIZATION .
TOWARDS DIFFERENT INTEREST GROUPS.i. Responsibility towards owners .
The responsibilities of business towards its investors are:a. Growth and appreciation of capital. deposits etc. d. The primary responsibilities of business towards its owners are to:a.Owners are the persons who own the business. Responsibility towards investors Investors are those who provide finance by way of investment in debentures. Run the business efficiently. and investing public are all included in this category. ii. financial institutions. Banks. Regular and fair return on capital invested. Proper utilization of capital and other resources. They contribute capital and bear the business risks. c. bonds. Ensuring safety of their investment. b. .
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